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An Ontario NDP government would boost the minimum wage to $12 an hour but cut the corporate income tax rate for small businesses, Leader Andrea Horwath says.

Horwath’s orange campaign bus pulled up at the Paintbox Bistro in Toronto’s Regent Park community Thursday where she argued that small businesses are looking for certainty in the minimum wage, not necessarily a lower rate.

The NDP would raise the rate to $12 an hour and then tie it to the cost of living.

“Minimum wage jobs used to be a starting point, an entry into the workforce,” Horwath said. “Today more and more people are relying on minimum wage jobs to pay for bills and to support their families.”

The competing interests of small business owners and employees can be balanced with a cut in the small business tax rate to 3% from 4.5%.

Only companies with less than $500,000 in annual taxable income would qualify for the tax break.

The NDP would lower the rate by 0.5% a year for three years, at a cost to the provincial treasury of $90 million for each rate decline of 0.5%.

Horwath said she’s confident a government could cover the loss of revenue by finding efficiencies.

“I know that Ontarians believe there is waste to be found. And look, we’re talking about a $120 billion budget. I don’t for a minute believe that you can’t find half a percent, 0.5%, in savings by doing things differently, by respecting the tax dollar, by squeezing out the waste and consolidating where there’s overlap,” Horwath said.

Plamen Petkov, Ontario vice-president of the Canadian Federation of Independent Business (CFIB), said he’s pleased that the NDP is looking at ways to mitigate the impact of a minimum wage hike on small businesses, but Horwath’s proposal will only help the more successful companies.

“The offset measure is not going to work in the situation where you have businesses that are not making any profit,” he said.

The CFIB proposes that the government increase the basic personal income tax exemption in Ontario so that workers can keep more of their income.

Saskatchewan residents don’t pay personal income tax on the first $17,000 in earnings, but the Ontario taxman takes a bite on anything over $10,000, Petkov said.

Investing in training would also help people break out of minimum wage positions, he said.

In Ontario, the corporate tax rate is 4.5% on the first 500,000 in taxable income and $11.5% on earnings over that threshold.

Premier Kathleen Wynne has already mandated that the minimum wage will rise to $11 from $10.25 on June 1, and her May 1 budget would have linked it to the cost of living.

The Liberals accused Horwath of remaining silent on the minimum wage until embarrassed into taking a position, and noted she rejected a budget that would have ensured the lowest earners kept up with inflation.